Yes, that can be part or all of the problem, however, that error has been known to show with all kinds of connections.
Dial-up, cable, DSL, shared (ie: using a router), and not.
Simply put, the server didn't respond to the IRC client in a timely manner, so the client returned a Timeout error.
I've even seen this happen on non-irc items, such as web browsers just going to view a page on the web.
